BILL ANALYSIS Ó
AB 1892
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Date of Hearing: April 12, 2016
ASSEMBLY COMMITTEE ON HIGHER EDUCATION
Jose Medina, Chair
AB 1892
(Medina) - As Amended March 28, 2016
SUBJECT: Student financial aid: Cal Grant C awards
SUMMARY: Reforms the Cal Grant C Program to create Cal Grant C
Entitlement and Competitive Award (C Entitlement / C
Competitive) programs, administered by the California Student
Aid Commission (CSAC), to provide need-based financial aid to
students enrolled in occupational or technical training programs
between four months and two years in length. Specifically, this
bill:
1)Reforms the existing Cal Grant C Program into the C
Competitive program, and makes the following changes to the
program:
a) Reduces the income limitations to align with the Cal
Grant B Award program.
b) Establishes award amounts as follows:
i) $2,462 for tuition and fees; and,
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ii) $547 for access costs and training related costs
such as special clothing and required tools and
equipment.
iii) $2,462 for California Community College (CCC)
students (these students do not receive the
aforementioned tuition and fee award) to cover access
costs and training-related costs. Requires CSAC to
establish a second application deadline of September 2
for CCC students to apply for this award.
c) Removes the requirement for CSAC to consult with
specified stakeholders regarding workforce needs and
industry demands and instead requires the Chancellor of the
CCC to annually provide CSAC with a regional inventory of
priority and emerging industry sectors and priority
occupational and technical training programs developed by
CCC economic and workforce development regions. The
programs must have high employer demand, high projected
employment growth, high earning outcomes, or are a part of
a well-articulated pathway to economic security. Requires
CSAC to use this information to determine the priorities
for program awards, and to publish and maintain the
priority list on its website.
d) Requires CSAC to work with stakeholders, including the
CCC Chancellor's Office to develop an outreach plan that
provides information to students regarding Competitive C
awards.
e) Requires CSAC, rather than the Legislative Analyst's
Office (LAO), to report on the outcomes of the Competitive
C program on or before April 1, 2017 and on or before April
1 of each odd-numbered year thereafter.
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2)Establishes the C Entitlement program to provide an access
award to CCC students enrolled in for-credit high-priority
certificate or credential programs (identified by CSAC
pursuant to (1)(c)) of less than one academic year in length,
as follows:
a) Defines "academic year" to constitute two semesters or
24 semester units.
b) Provides the access costs shall not exceed $3,000, and
may be adjusted in the annual Budget Act.
c) Provides that a student is entitled to receive an
Entitlement C award if, in addition to meeting eligibility
requirements consistent with those of the Cal Grant A and B
Entitlement Awards programs, a student satisfies all of the
following:
i) The student is a California resident;
ii) The student has submitted a complete application by
the third September 2 following high school graduation or
its equivalent;
iii) The student demonstrates financial need consistent
with the Cal Grant B Entitlement program;
iv) The student attains a high school grade point
average of at least 2.0 on a four-point scale; and,
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v) The student is pursuing a for-credit certificate or
credential instructional program offered by a community
college that is less than one academic year in length.
EXISTING LAW:
1)Authorizes the Cal Grant C program, administered by CSAC to
assist with tuition and training costs at occupational or
vocational programs of four months to two years in length.
Since 2000-01, the total number of new annual Cal Grant C
awards has been set at 7,761. The maximum award amount and
the total amount of funding is determined in the annual Budget
Act ($2,462 for tuition and $547 for non-tuition access
costs).
2)Requires CSAC to use appropriate criteria in selecting award
recipients including family income and household size,
household status, and employment status of the applicant.
CSAC is directed to give additional consideration to
disadvantaged, low income, and long-term unemployed
applicants.
3)Requires CSAC to consult with appropriate state and federal
agencies to develop areas of occupational and technical
training for which students may utilize Cal Grant C awards.
These areas of occupational and technical training are
required to be regularly reviewed and updated at least every
five years, beginning in 2012.
4)Requires CSAC to give priority in granting Cal Grant C awards
to students pursuing occupational or technical training in
areas that meet at least two of the following criteria: high
employment need, high employment salary or wage projections,
and high employment growth. CSAC is required to determine
areas of occupational or technical training that meet these
criteria in consultation with the Employment Development
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Department (EDD) using projections available through the Labor
Market Information Data Library.
5)Requires CSAC to examine the graduation rates and job
placement data of eligible programs, and commencing with the
2014-15 academic year, to give priority to Cal Grant C
applicants seeking to enroll in programs that rate high in
graduation rates and job placement data.
6)Requires CSAC to consult with EDD, the CCC Chancellor's Office
(CCCCO), the California Workforce Investment Board, and local
workforce investment boards to (a) publicize the existence of
the grant program to long-term unemployed, and (b) develop a
plan to make students receiving awards aware of job search and
placement services available through EDD and local workforce
boards.
7)Requires the Legislative Analyst's Office to submit a report
to the Legislature on the outcomes of the Cal Grant C program
on or before April 1, 2015, and on or before April 1 of each
odd-numbered year thereafter, as specified.
FISCAL EFFECT: Unknown.
COMMENTS: Background. The existing Cal Grant C program
provides financial aid to support California students pursuing
occupational and technical training. Statute limits the number
of new annual awards to 7,761, which has not changed since
2000/01. Annual Cal Grant C awards are worth up to $2,462 for
tuition and $547 for books and supplies, and may provide support
for up to two years. Students attending community college
programs are only eligible to receive the smaller stipend for
books, not the tuition grant, whereas students attending other
schools receive a combined grant. Students who do not qualify
for the entitlement Cal Grant program may become eligible for
Cal Grant C, these include:
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1)Students who meet the requirements to receive an Entitlement B
award, but are enrolling in an occupational and technical
training programs of less than one year in length (Entitlement
B awards can be used for programs of 1 year or longer); and,
2)Students who do not meet the requirements to receive an
Entitlement B award and did not receive a Competitive Cal
Grant A or B Award.
Students are entered into the existing Cal Grant C award pool if
they indicate on their FAFSA that they are entering a vocational
program and submit a supplemental form to the Student Aid
Commission. Based on statute, the Commission prioritizes Cal
Grant C applicants pursuing training in occupations that meet
strategic workforce needs and those coming from disadvantaged
backgrounds.
According to information provided by CSAC, prioritization
requirements in statute for the Cal Grant C Program have not
been used because, since the implementation of the priority
requirements, the program has not been oversubscribed.
According to CSAC, of the CCC students selected for an award,
only about half actually receive the award ("take rate"). In
2014-15, of the 13,715 CCC students who were awarded a Cal Grant
C, only 6,535 CCC students actually received an award. The take
rate for private and independent institutions is higher than
that for CCC students. It is not entirely clear why the take
rate in CCC is so low; some reasons provided include (1) the
incentive created by the higher tuition award amount provided to
for-profit and independent institutions, and (2) a lack of
financial aid staffing and outreach provided at CCCs.
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Purpose of this bill. According to the author, California has
prioritized workforce development at CCCs; earlier this year,
the CCC Task Force on Workforce, Job Creation and a Strong
Economy issued a report that included 25 recommendations to
strengthen workforce education. Among its recommendations, the
Task Force highlighted the importance of strengthening the Cal
Grant C program and aligning the program with the CCC economic
development priorities. According to the author, college
affordability is a challenge that students face as they aspire
to pursue workforce training. Living costs, transportation,
books, and other costs that are not tuition often compromise the
bulk of students 'college expenses'. Expanding the Cal Grant C
Program and aligning it to the CCC Strong Workforce program will
provide students important non-tuition funding and support
college access and success.
Rationale for Cal Grant C Entitlement Award. The Cal Grant A
and B Entitlement Awards guarantee an award for recent
California high-school graduates that meet specific academic and
income eligibility guidelines. However, students who enroll in
a program of less than one-year in length are not eligible for
an A or B Entitlement award. According to the CCCCO, this
includes programs in high-demand, high-wage career fields such
as business, IT, engineering technology, health, public service
and commercial services. According to CCCCO data, as many as
60,000 students graduated from these high-priority fields
between 2010-11 and 2014-15. It is difficult to determine how
many of these students would meet the eligibility requirements
for the Entitlement C program proposed in this bill. For
example, the bill requires students to be within three years of
high school graduation; according to the LAO, in 2014-15, only
5% of Cal Grant C recipients were 19 or younger, and 29% were
between 20 and 24.
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Rationale for CCC stipend in the C Competitive Award. In its
recent analysis, the LAO stated there is no policy reason to
provide less of a stipend to Cal Grant C students than Cal Grant
B students, and suggests changing the Cal Grant C program. The
LAO suggests some options, including raising the award amount
for all Cal Grant C recipients, or providing a targeted increase
for community college students. This bill creates a targeted
stipend increase for CCC students enrolled in high-priority
programs; the amount of $3,000, as proposed in this bill, is
consistent with the increase in the Cal Grant B Access Award
proposed in AB 1721 (Medina), which is also pending in this
committee. Committee staff understands the author's intent is
to equalize the stipend with the Cal Grant B Access Award.
Issues to consider. Moving forward, the author and committee
may wish to consider the following issues and possible
amendments:
1)Reducing Competitive C Income Requirements. This bill
proposes to reduce the income limitation for C Competitive
recipients to align with the Cal Grant B program. This change
could affect students currently receiving the Cal Grant C.
Committee staff has requested data from CSAC; depending on the
information that is received, the author may wish to amend to
ensure current Cal Grant C recipients are not harmed by this
change.
2)Reporting requirements. This bill transfers Competitive C
reporting requirements from LAO to CSAC and requires the first
report to be submitted by April of 2018. The author may wish
to extend the due date for the first report to 2019, to allow
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for at least one full award year prior to the issuance of the
initial report.
3)Entitlement C application timelines. This bill would allow
Entitlement C recipients three years post high school
graduation to apply for an award; Cal Grant A and B
Entitlement applicants are not provided this three-year
extension. Supporters argue that this additional time
allowance is appropriate for the Cal Grant C program because
of the nontraditional populations of students served by CTE
programs.
4)Reporting on CCC take rate. As previously outlined, only
about 50% of CCC students awarded a Cal Grant C ultimately
receive the award. The reasons for this low take rate are
unclear. The author may wish to require CSAC and the CCCCO to
review and make recommendations to improve the C program take
rate.
REGISTERED SUPPORT / OPPOSITION:
Support
California Chamber of Commerce
California Community College Chancellor's Office (Sponsor)
California Community College Association for Occupational
Education
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California Economic Summit
Chabot-Las Positas Community College District
Foothill-De Anza Community College District
Kern Community College District
Los Angeles Area Chamber of Commerce
Los Rios Community College District
Peralta Community College District
San Diego Community College District
Santa Barbara City College
Santa Monica College
South Orange County Community College District
Ventura County Community College District Board of Trustees
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Opposition
None on File
Analysis Prepared by:Laura Metune / HIGHER ED. / (916) 319-3960